Often homeowners want to know how quickly they can initiate a home refinance on the heels of a bankruptcy. The rules on this change, so we’ll tackle this often asked question here.
Generally speaking, here’s the scoop:
- Chapter 7 – a minimum of two years must have elapsed since the discharge date.
- Chapter 13 – court must permit you to proceed. Typically, this depends on whether you’ve made your required payments on time, and one year of the payout period has elapsed.
Other factors include:
- Was the bankruptcy caused by financial mismanagement? In other words, your spending?
- Was bankruptcy a result of a hardship such as an illness, loss of job, or another one-off scenario?
- How much time has elapsed of the pay-out period?
- How have you responded since—have you been paying on time?
- Have you taken measures to reestablish your credit?
- Do you have written permission from the bankruptcy court to pursue a new transaction?
Not sure where to start? Reach out to Golden Oak Lending today to set you on the right path!